Shareholders will be ecstatic, with their stake up 23% over the past week following Changsha Broad Homes Industrial Group Co., Ltd.‘s (HKG:2163) latest full-year results. It looks like a credible result overall – although revenues of CN¥3.4b were what the analyst expected, Changsha Broad Homes Industrial Group surprised by delivering a (statutory) profit of CN¥1.76 per share, an impressive 33% above what was forecast. This is an important time for investors, as they can track a company’s performance in its report, look at what expert is forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.
View our latest analysis for Changsha Broad Homes Industrial Group
SEHK:2163 Past and Future Earnings March 29th 2020
Following the latest results, Changsha Broad Homes Industrial Group’s lone analyst are now forecasting revenues of CN¥4.25b in 2020. This would be a huge 26% improvement in sales compared to the last 12 months. Statutory earnings per share are forecast to drop 11% to CN¥1.56 in the same period. Before this earnings result, the analyst had predicted CN¥4.29b revenue in 2020, although there was no accompanying EPS estimate. So we can see that while the consensus made no real change to its revenue estimates, the analystbegan providing earnings per share estimates, suggesting a heightened focus on the business’ earnings after the latest results.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. Next year brings more of the same, according to the analyst, with revenue forecast to grow 26%, in line with its 23% annual growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.7% per year. So although Changsha Broad Homes Industrial Group is expected to maintain its revenue growth rate, it’s definitely expected to grow faster than the wider industry.
The Bottom Line
The biggest takeaway for us from these new estimates is the bullish forecast for profits next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. We previously had no consensus price target, which could suggest the business has reached a point where the analyst feels comfortably deriving a valuation for it.
With that in mind, we wouldn’t be too quick to come to a conclusion on Changsha Broad Homes Industrial Group. Long-term earnings power is much more important than next year’s profits. At least one analyst has provided forecasts out to 2021, which can be seen for free on our platform here.
Don’t forget that there may still be risks. For instance, we’ve identified 3 warning signs for Changsha Broad Homes Industrial Group that you should be aware of.
If you spot an error that warrants correction, please contact the editor at [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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